AIA Forecast Shows Another Steep Decline in Nonresidential Construction Activity for 2010

Despite signs that the overall U.S. economy is beginning to improve, the American Institute of Architects (AIA) semi-annual Consensus Construction Forecast reports that nonresidential construction spending is expected to decrease by 13.4 percent in 2010 with a marginal increase of 1.8 percent in 2011 in inflation adjusted terms. Commercial and industrial projects will continue to see the most significant decrease in activity. The forecast also notes that institutional building categories will fare better over this period thanks, in part, to federal stimulus spending.

“When economies emerge from this prolonged recession, recovery for nonresidential construction activity typically takes longer,” says AIA chief economist, Kermit Baker, PhD, Hon. AIA. “Hardest hit will be the commercial and industrial sectors with projected declines in the 20 percent range for 2010 in most building categories. Led by the healthcare market, the institutional sector will see far less dramatic declines and should help lead the construction industry into recovery in 2011.”

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